As a New Zealand tax resident you’ll pay tax on income from New Zealand and overseas. This includes tax on the rental income from your overseas rental property.
Even though your property is overseas, you’ll still need to follow the New Zealand tax rules for your rental income.
Filing tax returns for your rental income
You'll need to file a New Zealand tax return for your overseas rental income.
You may also have to file a tax return for your rental income in the same country as your overseas property.
Working out tax you'll need to pay
Working out your rental income, expenses, and if there's GST to pay is not the same for all residential property. Check what to do for the type of property you're renting out:
Double tax agreements
Filing tax returns in New Zealand and overseas means you may be paying tax twice on the same rental income.
If New Zealand has a double tax agreement (DTA) with the other country or territory, you might:
- only have to pay tax on your rental income to us or them
- be able to claim a tax credit.
Each DTA is different, so you'll need to check to be sure how it applies or consult a tax professional.
If you have an overseas mortgage on your rental property, you may need to pay non-resident withholding tax (NRWT) or approved issuer levy (AIL) on the interest paid overseas.
Financial arrangements rules apply if your overseas mortgage is over certain thresholds. The rules may also apply to your foreign currency account or loans. This means any foreign exchange gain or loss may need to be included in your New Zealand income tax return.
Converting overseas currency for your tax return
You cannot put foreign currency amounts into your New Zealand tax returns.
Once you’ve worked out your overseas rental income and allowable rental expenses convert it to New Zealand dollars.